Canadian CANNAINVESTOR Magazine November 2018 | Page 222

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Writing on the recreational market and the supply shortages is something I will leave for mainstream media and others. We predicted this over 18 months ago and this demand demonstrates the strong revenues from this robust growing industry. That all of that has come to fruition is once again your validation of the integrity of our content compared to others. Now for Options …

This is a good link to gain a better understanding of how the options contract price changes with a change in the underlining share price. As for options themselves, quite simply, options give the holder the right but not the obligation to buy or sell the underlining asset. Because we do not focus on short selling, this article will be on the “buy” and long side. Right away this should sound very familiar to you … warrants!

We have discussed warrants many times and warrants are also the right but not the obligation to buy a stock at a given price. Our good friends at Deep Dive continue to provide a

detailed listing of Canadian Cannabis sector warrants. Such lists are available from many sources but I like that one because it also details any acceleration clauses – the last thing an investor wants is to find out the hard way that warrants that they purchased that expire in 18 months had an acceleration clause triggered (that they were unaware of) and that the warrants actually expired yesterday. So we are going to make a few assumptions with respect to Options:

1)The Options are Calls (allows you to buy the underlining asset).

2)The underlining assets are the common shares of the company and the shares trade freely on the secondary market (for example; TSX, NYSE, NASDAQ).

3)The Options are in the currency of the shares.

4)Shares of eligible stock subject to eligibility criteria set by

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